HomeMy WebLinkAbout1997-07-08 - AGENDA REPORTS - SYSTEM STUDY RESULT (2)AGENDA REPORT
City Manager
Item to be pre;
Dennis L=ens
UNFINISHED BUSINESS
DATE: July 8, 1997
SUBJECT: UNIT PRICING SYSTEM STUDY RESULTS
DEPARTMENT: Public Works
BACKGROUND
After receiving the Bevond 50 Percent Waste Reduction by 2000 report, the City Council at their meeting
on July 9, 1996, directed staff to work with the franchised haulers to research a residential unit pricing
system and prepare recommendations as a way to meet the City's two primary goals of (1) stabilizing
residential refuse rates and (2) increasing diversion. Accordingly, at the City Council Meeting on March
11, 1997 the City Council directed staff to contract with Skumatz Economic Research Associates (SERA)
to conduct a study of a residential unit pricing system in Santa Clarita and develop options for the
residential base rate for January 1998.
The results of the Unit Pricing Study were based on operational and disposal costs (which include 1997
landfill increases), diversion program, and efficiency changes provided, by the local franchised refuse
haulers; estimated amount of customer"migration" from higher to lower refuse service levels; diversion
incentive; implementation cost impacts of the unit pricing system; maintaining sufficient revenues to
maintain the existing refuse/recycling operations; and public input.
Study Results: Based on the preceding information, the study found that the most workable outcome
establishes a three tiered pricing range starting at $14.75 for 30 gallons, $23.55 for 60 gallons, and $32.40
for 95 gallons. Averaged, this equates to a $.60 per month citywide increase. The increase is largely due
to relative costs of disposal vs. diversion, as well as implementation issues. Even with an increase in
average bills, however, bills for low users could be constructed to fall if rates for other customers make
up the difference. The study created several scenarios which provide `Yate stability" and lower bills for
those willing to recycle more (Attachment A). The City's consultant will present the methodology and
study results at the meeting. A copy of the final report may be found in the City Clerk's reading file.
RECOMMENDATION
Receive the Unit Pricing Study final report from SERA. Direct staff to work with residential franchise
haulers to determine measures to stabilize rates by January 1998 and enhance the existing recycling
programs to gain increased diversion.
ATTACHMENTS
A. Rate Scenarios
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Attachment A
Unit Pricing Study
Agenda Report July 8, 1997
Table 1: Recommended Rates with Program Fee Alternatives
Assumed
"Can" System
"Can"
"Can"
% of
No separate program fees
$1.50
$4.15
Customers
Program
Program
Fee
Fee
Current total bill
100%
$22.13/hh/month
$22.13
$22.13
1-30 gallon can
35%
$14.75 save $7.38 ( -33%)
$15.25
$16.20
1-60 gallon can
40%
$23.55 pay $1.42 ( +6%)
$23.50
$23.40
1-95 gallon can
25%
$32.40 pay $10.27 ( +46%)
$31.75
$30.60
New "average" bill
$23.77 up $0.60 (+3%)
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